Chapter 2 Managing the Information Technology Resource 1
Chapter 2
IT Strategy
True-False Questions
1.
An alignment enabler is an organizational factor that should be minimized because it can
hinder achieving IT-business alignment.
2.
Weak economic growth is an example of one of the top six inhibitors to achieving
IT-business alignment.
3.
A mission statement is a concise, measurable statement of where the company wants
to go and what it aspires to be.
4.
A purpose of strategic objectives is to articulate how the vision will be accomplished over an
identified time period.
5.
An IT mission statement is a concise statement of why the IT group exists and the purpose
and function it provides for the company.
6.
The IT strategy formulation process is best described as a sequence of activities that
transforms the current alignment state to the envisioned future alignment state.
7.
The typical role of champion is to obtain funding and other resources needed to implement
the vision.
8.
The “To–Be” state refers to the current state of the firm in terms of the components of the
Strategic Alignment odel.
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9.
The SWOT’s objective is to recommend strategies that ensure the best alignment
between the external environment and internal situation.
10.
An objective of the Ansoff’s Product/Market Matrix is to help identify growth strategies for
an organization.
11.
The primary objective of the Ansoff’s Product/Market Matrix is to identify external
environmental threats to an organization.
12.
An objective of the market penetration strategy of Ansoff’s Product/Market atrix model is to
define new markets with innovative new products.
13.
Rivalry between existing firms is usually the strongest of the external environment threats.
14.
The threat of substitute products pertains to the likelihood of a customer being able to use a
completely different product obtained from a company outside the industry.
15.
Commitment of senior business management is an essential component for the successful
implementation of an aligned IT strategy.
Multiple Choice Questions
16.
Each of the following is an enabler of IT-business alignment except:
a. senior executive support for IT.
b. IT management lacks leadership.
c. IT understands the business.
d. well- prioritized IT projects.
17.
Each of the following represents a key element in the formulation of strategy except:
a. strategy.
b. inhibitors.
c. mission.
d. vision.
18.
Which of the following is the best example of a strategic objective?:
a. Support worldwide information requirements and business objectives.
b. Provide competitive advantage to the company.
c. We will drive or enable business strategies to ensure that our contributions
provide the highest value to the corporation.
d. Become #1 or #2 in every market we serve.
19.
According to Schein, each of the following is a sub-culture of management except:
a. executive culture.
b. engineering culture.
c. operator culture.
d. knowledge culture.
20.
According to the Strategic Alignment Model, each of the following components is concerned
with the external domain of IT strategy except:
a. scope of the firm’s technology.
b. systemic competencies.
c. IT processes.
d. IT governanceinfrastructure.
21.
Each of the following is a component of the Strategic Alignment Model except:
a. IT governance.
b. administrative structure.
c. financial structure.
d. business governance.
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22.
Which of the following is not a component of IT Strategy within the Strategic Alignment
Model?:
a. tTechnology scope
b. IT governance
c. sSystemic competencies
d. sSkills
23.
Each of the following is a key component of the IT Strategy Formulation rocess except:
a. systems analysis and design.
b. strategy alternatives analysis.
c. periodic review.
d. “As–Is” tate of the organization.
24.
Each of the following is a component of the SWOT model except:
a. Strengths.
b. Weaknesses.
c. Organizations.
d. Threats.
25.
Each of the following is a market positioning strategy of the Ansoff Product/Market Matrix
except:
a. diversification.
b. market penetration.
c. product development.
d. best products.
26.
The component of the Delta model which would use IT strategies such as integrated Supply
Chain Management and Customer Relationship Management or collaborative planning and
forecasting using eb technologies best describes:
a. system lock-in.
b. customer solutions.
c. best products.
d. product economics.
Chapter 2 Managing the Information Technology Resource 5
27.
Which of the following frameworks addresses IT strategy by application prioritization and
application portfolio management?:
a. Framework for assessing the strategic importance of an IT system.
b. Corporate goals for IT.
c. Seven sources of innovation.
d. Balanced scorecard.
28.
Which of the following frameworks addresses IT strategy by examining the focus of IT in
organizations relative to strategic goals and effectiveness?:
a. Framework for assessing the strategic importance of an IT system.
b. Corporate goals for IT.
c. Seven sources of innovation.
d. Balanced scorecard.
29.
According to Porter’s Five Competitive Forces model, all of the following are considered
external environmental forces except:
a. power of suppliers.
b. diversification of product/market.
c. substitute products/services.
d. power of buyers.
30.
Which of the following is least likely to be used as a technique for evaluating alternative IT
strategies?:
a. sScenario planning
b. bBalanced scorecard
c. cCost and benefit analysis
d. gGap analysis
Fill In the Blanks
response to sets of perceived environmental factors
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what it aspires to be.
Reference: p. 27
The three key elements of the formulation of strategy are vision, strategy, and mission.
34.
Reference: p. 27
and function it provides for the company.
Reference: p. 30
35.
information embedded in them is referred to as dematerialization.
36.
The phenomenon whereby the pervasiveness of IT in manufacturing and services has made
the market value of physical products and processes less important than the knowledge and
Reference: p. 31
to work, new organizational structures, and new relationships with customers, suppliers,
partners, and employees.
Reference: p. 32
37.
The role that information technology takes when the IT strategy becomes the business
38.
In its formulation of an IT strategy, IT management needs to be concerned with both the
Reference: p. 38
39.
Reference: p. 40
In the Strategic Alignment Model, the linkage between the internal domains of business and
IT such that the capabilities of the IT infrastructure support the requirements and
40.
In the Strategic Alignment Model, the linkage between the IT strategy domain and the
32.
Chapter 2 Managing the Information Technology Resource 7
42.
transforms the current alignment state to the envisioned future alignment state.
Reference: p. 40
has the compelling vision of the “To Be” state of affairs.
Reference: p. 42
44.
A primary objective of the SWOT analysis is to recommend strategies that ensure the best
his/her organizational influence to obtain the resources needed to implement
the vision.
Reference: p. 43
alignment between the external environment and internal situation.
Reference: p. 44
Reference: p. 44
45.
Critical success factors that provide a firm with a potential competitive edge best describes
Essay Questions
46.
List and briefly describe five of the seven characteristics an effective vision statement should
have.
41.
The IT strategy formulation process can be described as a sequence of activities that
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47.
List and briefly describe seven attributes of a sponsor or champion.
Reference: p. 42
Chapter 2 Managing the Information Technology Resource 9
48.
Briefly describe Porter’s Industry Profitability Five Forces model, SWOT analysis, and
Ansoff’s roduct-market analysis as methods to facilitate management’s evaluation of strategy
alternatives.
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49.
Describe and discuss the IT Strategy Formulation Process.
Chapter 2 Managing the Information Technology Resource 11
50.
Describe how IT can be used as an enabler of business transformation. Give examples from
industry.